Kelda Group plc, Aquarion Close On the Acquisition of American Water Works New England Operations
BHC and Newly Acquired Subsidiaries Rebranded Aquarion Water Company
Aquarion Company, a subsidiary of Kelda Group plc, has closed on the acquisition of four American Water Works subsidiaries in Massachusetts, New York and New Hampshire. Aquarion's BHC subsidiary has closed on the acquisition of Connecticut-American.
The acquisition was completed for a combined consideration of approximately $120 million in cash, plus the assumption of $104 million in debt. The companies jointly announced their acquisition agreement on August 30, 2001.
Aquarion also announced that to incorporate the new water utilities into the Aquarion group, it has rebranded the name of BHC to Aquarion Water Company of Connecticut, which now includes the former Connecticut-American Water Company. The other acquired American Water Works subsidiaries in New York, New Hampshire and Massachusetts have likewise been rebranded under the Aquarion Water Company banner. Aquarion also has acquired Massachusetts Capital Resources Company, a former finance subsidiary of American Water Works Company, which is now called Aquarion Water Capital of Massachusetts, Inc.
The purchase adds some 64,000 customer accounts, or about 177,000 residents in 17 towns, to Aquarion's water utility customer base.
Public Utility Commissions in Connecticut, New Hampshire and New York approved the transaction. Regulatory approval was not required in Massachusetts. The Federal Trade Commission also reviewed the acquisition.
Aquarion Company President and Chief Executive Officer Richard K. Schmidt said the closing represents a tremendous milestone for Aquarion. "Not only does it increase Aquarion's water utility business by about 50 percent, it supports Kelda's strategy of having Aquarion serve as the springboard for expansion in the U.S."
"Aquarion welcomes our new colleagues and looks forward to serving new and existing customers with a larger, more efficient system that brings a strong regional focus to the area," Schmidt added.
Kelda Executive Chairman John Napier said the acquisition enhances Kelda's investment in Aquarion. "Aquarion has been key in developing our USA water interests as its management team has performed well and it strives for excellence in all aspects of its operations. The purchase of these American Water Works Companies has an excellent fit with Aquarion allowing it to expand its reach in New England," he said.
In addition, Aquarion also announced it had formed a new business unit to maximize its expertise by consolidating existing programs and providing new services in the non-regulated water and waste water sector. Named Aquarion Services Company, the new entity contracts for municipal and private water and waste water operations and maintenance, specialty services, management consultations, engineering consulting services, and under Safety Valve, consumer water line protection plans.